Peru’s Middle Class has Increased 50 Percent in Last Few Years – Minister

Peru’s middle class has grown by 50 percent in the past few years thanks to economic expansion, the construction of new homes, and growth in microfinance, according to Economy and Finance Minister Luis Miguel Castilla.

Castilla, who was speaking at the World Economic Forum’s meeting in Latin America, said that the growing middle class has fueled consumer demand in Peru, state news agency Andina reported.

“The dynamism of this type of demand has to do with the boom in the expansion, the expansion of homes and microfinance, in a context of economic, political stability,” Castilla said.

Peru’s poverty rate has fallen to about 28 percent of the current population, from about 60 percent 10 years ago thanks to economic growth.

Peru’s gross domestic product has consistently seen robust growth, initially fuelled by a commodities boom and as domestic demand plays an increasingly important role.

Peru’s GDP grew 8.8% in 2010, 6.9% in 2011 and 6.3% in 2012. It is expected to expand by about 6.3% this year. 

Castilla said that one of Peru’s challenges will be to maintain stability and policies to ensure sustainable growth, including improving education, health services and security.

“We need stability and for the government to have the appropriate policies,” Castilla said.

Peru’s middle class began to shrink under government austerity measures in the late 1970s and a sharp drop in wages, followed by a weak and disastrous economy in the following Belaunde and Garcia administrations, respectively.

Leave a Reply

Your email address will not be published. Required fields are marked *